DANGOTE Petroleum Refinery claimed on Friday that the recently negotiated naira crude sales are not working.

The Nigerian government officially launched its naira-for-crude sale agreement with Dangote Refinery on October 1, 2024. The crude supplies were to be made by the Nigerian National Petroleum Company (NNPC).

According to Minister of Finance, Mr Wale Edun, “The sale of crude oil and refined petroleum products in Naira has officially commenced as of October 1st, 2024,” he stated in October.

“Following the launch, key stakeholders convened on October 3, 2024, to conduct a post-commencement review of the Crude Oil and Refined Products Sales in Naira initiative, the commencement of this strategic initiative was affirmed by key stakeholders.”

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Edun further said that the commencement of this strategic initiative was affirmed by key stakeholders, noting that the naira crude sales initiative was targeted at stabilising the Nigerian economy and enhancing local currency usage in the oil sector.

Dangote refinery interview reveals cracks

However, on Friday, Executive Director at Dangote Group and Head of Dangote Petroleum Refinery, Mr Edwin Devakumar, simply said the initiative was a near failure.

“We need 650,000 barrels per day. The state oil firm, NNPC Limited, agreed to give a minimum of 385,000 bpd but they are not even delivering that,” said Mr Devakumar told Reuters.

He described crude deliveries from NNPC under the scheme as “peanuts.”

However, Reuters reported a twist to the story, quoting Acting Executive Director of the Crude Oil Refinery-owners Association of Nigeria (CORAN), a trade group of refiners, Mr Mathins Obaze, as saying that Dangote is “the only one of 8 operational refineries in Nigeria to have benefited from the naira-denominated crude sale arrangement.”

“Members are still unable to access crude in naira and are currently engaging the government for a resolution,” Obaze said.

Dangote’s crude receipts

On October 23, 2024, Dangote Petroleum Refinery received four cargoes of crude oil from the Nigerian NNPC under the naira-for-crude sale agreement.

“The naira-for-crude deal has started. The Dangote refinery has received four cargoes so far and we are still expecting more. The four cargoes have been delivered to the refinery within the past three weeks. We are still expecting more cargo in the coming week,” an official of Dangote Petroleum Refinery told The Punch.

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“Don’t forget that this first phase of the naira-crude sale is just for six months. The government may decide to renew it at the end of the first six months and they may decide not to. So, we don’t know what will happen yet after the first six months.” the official noted.

NNPC directs marketers to cease petrol imports

Meanwhile, in a dictatorial manner, the NNPC has ordered marketers to stop importation, urging them to buy only from Dangote refinery.

BusinessDay reported that the directive emerged during a high-level meeting in Abuja, attended by NNPC Group CEO, Mr Mele Kyari, representatives of the Major Oil Marketers Association of Nigeria (MOMAN), Depot and Petroleum Products Marketers Association of Nigeria (DAPPMAN) and key stakeholders from companies such as 11 Plc, Matrix, AA Rano, and the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) among other stakeholders.

“According to sources privy to the discussions, the NNPC unequivocally read the ‘riot act,’ informing stakeholders that all petrol supply would now hinge on clearance from the Dangote Refinery,” BusinessDay reported on Saturday.

“NNPC emphasised that going forward, no marketer would be permitted to import petrol without specific clearance tied to Dangote’s capacity,” a marketer in attendance said.

Economy Post independently confirmed from a petroleum marketer that the directive was true.

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“How can you order us to stop importation of petrol and buy only from Dangote refinery in a market that is already deregulated? If you deregulate and still want marketers to buy from the place you want, then you have not done deregulation,” the marketer, who said he would not obey the directive, noted.

“So, you want the entire nation to buy petrol from Dangote refinery alone. That’s dictatorship,” the marketer added.